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American subsidizes American Eagle |
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Sunday, 15 April 2007 |
American subsidizes American Eagle by paying Eagle a percentage over their budgeted costs.
James C. Little
Director Air Transport Division
International Administrative Vice President
American Eagle
AMR Eagle Holding Corporation is a wholly-owned subsidiary of AMR and operates two regional airlines, which do business as "American Eagle" - American Eagle Airlines and Executive Airlines. The operations of American and AMR Eagle are managed as a single business unit providing for an integrated route network. The AMR corporate strategy views the aircraft of these carriers as one fleet, which is deployed through a combined route scheduling system to maximize the operating results of the entire fleet. AMR's chief operating decision makers make resource allocation decisions to maximize the Company's consolidated financial results, not the individual results of American or AMR Eagle. Although from a decision making point of view, AMR has one operating segment (consisting of the collective operations of American and AMR Eagle), Eagle remains a stand alone operation in terms of accounting, operational performance, and workforce.
AMR Eagle's financial arrangement with AMR changed in 2003 from a revenue sharing to capacity purchase agreement, in which American pays a markup over Eagle's budgeted costs. As with other carriers, American assumes the risk in fuel and other volatile cost areas. Eagle intends to grow its jet fleet from 169 units in 2003 to 249 in 2006, a 47% increase. Eagle employs approximately 11,000 personnel.
Horizon
Horizon Air joined Alaska Air Group in 1986. It serves 39 cities in six states (Washington, Oregon, Montana, Idaho, California and Arizona) and six cities in Canada. Horizon's operating fleet is less RJ oriented than other regionals, with 18 jet and 44 turboprop aircraft. The jets provided 46% of the 2003 capacity. Horizon flights are listed under the Alaska Airlines designator code in airline computer reservation systems. Additionally, effective January 1, 2004, Horizon began operating regional jet service branded as Frontier Jet Express under a 12-year agreement with Frontier Airlines.
Alaska and Horizon coordinate their flight schedules to provide service between any two points served by their systems. In 2003, 31 % of Horizon's passengers connected to flights operated by Alaska compared to 29% in 2002.
Mesaba
Mesaba is a subsidiary of MAIR Holdings, which also owns Regional Airline Big Sky. In 3Q03, Mesaba accounted for 96.4% of MAIR revenues. Mesaba operates as Northwest Airlink and Northwest Jet Airlink under two separate agreements with Northwest Airlines. Mesaba serves 112 cities in the United States and Canada from Northwest's hub airports, Minneapolis/St. Paul, Detroit and Memphis.
Copyright 2004 @ Transport Workers Union - all rights reserved.
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